India's biopharmaceutical sector continued to expand rapidly in 2008. Revenue in the sector exceeded $2.5 billion, with an estimated annual growth rate of 25%.1

As in previous years, the biopharmaceutical sector continues to be an export leader for the Indian economy. In 2008, about 56% of Indian biopharmaceutical products and services were sold abroad or otherwise qualified as exports.

Moreover, India's basic research and development (R&D), clinical research, and production capacities also have continued to expand to support the sector's growth. The country's regulatory capabilities also have been showing some signs of improvement. However, this growth has not been without glitches. The highlights below show the past year's developments in India.2

SUBSTANDARD INDIAN VACCINE PRODUCERS SHUT DOWN UNDER WHO PRESSURE

In recent years, following site inspections, the World Health Organization (WHO) had complained of poor manufacturing practices used by several Indian vaccine producers. Indian government inaction reportedly caused WHO to threaten a suspension of purchases for its global vaccination campaigns. In January 2008, the Indian government effectively shut down four of these vaccine makers, Central Research Institute in Kasauli, Pasteur Institute in Conoor, BCG Lab in Chennai, and the Haffkine Institute in Maharashtra. In April, it was announced that the first three of these plants would be converted into drug-testing facilities to help India curb its counterfeiting rackets. Indian products currently account for about one out of every 20 drugs tested.

NEW REGULATORY AUTHORITY FOR BIOPHARMACEUTICALS

In July, a bill was drafted to establish India's National Biotechnology Regulatory Authority (NBRA), which will oversee and regulate biopharmaceutical products including recombinant proteins and vaccines, gene therapies, and blood and plasma-derived products. Indian officials also revealed plans to elevate the Department of Biotechnology to full ministry status.

IP CLIMATE COMPLAINTS CONTINUE

In February, the US-based Biotechnology Industry Organization (BIO) publicly demanded that the Office of the US Trade Representative (USTR) keep India (and other countries) on the USTR's "Priority Watch List," and the USTR eventually did so. BIO wants India's patent law to be aligned with Western intellectual property (IP) protections, with clarification of the patent eligibility of polypeptides and nucleic acids, and a greater allowance for "evergreening" molecules with clinically insignificant modifications. In May, it was reported that regulatory officials in India were thinking about requiring biopharmaceutical developers to obtain product patents even for biosimilars because of the complexity of the large-molecule evaluation process.

CLINICAL RESEARCH: ARE OPPORTUNITIES BEING MISSED?

The Indian population is highly diverse, genetically, yet is more likely than the Caucasian populations to carry genes predisposing for obesity and type 2 diabetes. These findings highlight India's potential as a clinical proving ground for drug candidates. The clinical research market in the country for all drugs (both large- and small-molecule), was about $300 million in 2008.

To expand this market, government officials announced last summer that plans were being drawn up to allow foreign drug companies to test drugs in India in Phase 1 trials. Unlike now, foreign firms have been restricted to Phase 2 and Phase 3 trials.

However, India has been unable to exploit this market opportunity fully, because of bureaucratic complexity and lengthy delays for trial approvals.